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Why the NHL Decided to Open Up More Sponsorship Inventory on the Ice

The league spent 3+ years discussing and planning before deciding to go forward with the initiative.

Adam White

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TAMPA, FL – JANUARY 28: Brent Burns #88 of the San Jose Sharks skates to the net with the puck during the 2018 Honda NHL All-Star Game between the Atlantic Division and the Pacific Divison at Amalie Arena on January 28, 2018 in Tampa, Florida. (Photo by Dave Sandford/NHLI via Getty Images)

Like any good league, finding ways to bring value to both sponsors and the clubs keeps all parties happy and engaged.

For the National Hockey League, opening up four new in-ice spots starting during the 2018-2019 season was about giving clubs the opportunity to find new camera-visible signage and bringing what the league expects to be a “mid-seven-figure per position opportunity for the NHL during the playoffs.”

“It has always been an area that I am interested in developing. Not to only add more logos, but to deliver more value to our current and potential future sponsors,” said Keith Wachtel, the NHL’s Chief Revenue Officer. “If you look at our partnerships at the club level and what our league partners like when it comes to a league-wide event, in-ice positions are generally your largest partners at the club level that garner a significant amount of television impressions.”

What Wachtel sees as the most unique selling point for these particular positions is the opportunity sponsors will have to be a part of the biggest moments of the game as well as the highlights shared across the NHL’s digital platforms and social media channels.

“When we looked at it and considered other signage opportunities, which there are a lot of others that we have explored and that we continue to explore, we know that those four are extremely valuable. If you think about the way the game is played, most of the action that is comprised of goals, big hits, and saves are done in the corners as opposed to necessarily center ice. All of the various instant replays you will see in games but also across social media and highlight packages generally show a goal, a save, or a big hit.”

The league began testing the inventory this past pre-season in China and then followed up that test with placement at this year’s All-Star Game after what had been a three-year dialogue surrounding the initiative.

“We tested them in China during several pre-season games. Then we moved to the All-Star Game which really allowed us to take a look at them on an NHL rink in front of broadcasters, sponsors, clubs, league executives, and fans,” said Wachtel. “Ultimately, we came to the unanimous decision that we would go ahead and install those for the start of next season.”

Mercedes-Benz Arena on September 21, 2017 in Shanghai, China.

Relying on services like Nielsen Sports and GumGum Sports, the league was able to figure out the amount of time each position would be visible during a broadcast. For the teams that wanted to, many conducted their own analysis given that their broadcast angles might be slightly different than others.

Based on those valuations and what the market will bear is how Wachtel and his team see the inventory being sold, a process that the league will help with but will ultimately come down to how each team will decide to package them.

“How they will sell them is going to be unique to each club. They will most likely package them into broader sponsorship deals, because they are not necessarily interested in selling a brand that position without that brand already being a team partner.”

Unlike the four center ice placements, the league will take over control of the corner inventory come playoff time in order to sell a package that will span across every game of the Stanley Cup Playoffs through the Stanley Cup Final.

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“I look at this differently for us,” said Wachtel. “It doesn’t matter who is in the playoffs and that is the issue with the clubs, you don’t know who is going to make the playoffs so the clubs can’t monetize the playoffs the same way that the league could.”

Although we are still close to a month from a team raising Lord Stanley’s Cup above their head, Watchel and his team are already in the marketplace selling the inventory for next year’s playoffs. The exposure potential and exclusivity of the placements are features that Wachtel sees as a differentiator for the league when it comes to working with global brands.

The league tested the inventory at the All-Star Game this year. (Photo via NHL)

“Right now, we are in the marketplace talking about next year’s playoffs, selling anywhere from two to four marketers and those marketers will be at every game, every night, for every playoff game around the world. Because of that, our primary focus is to sell these to global marketers. We want a marketer that values not only the North American exposure, but also the exposure that we provide in all countries throughout Europe, Australia, and China. We have over 160 countries that broadcast NHL games, especially during the Stanley Cup Playoffs.”

Seeing that this is the first time the league has added new in-ice inventory since the original four at center ice, the question then becomes where the league goes from here and whether or not patches on sweaters may be next. A topic Wachtel was quick to dismiss given what he believes the impact the new corner inventory will have.

“If you think about it, right now teams in the NBA are selling jersey patches. It’s a great idea and they are making a lot of money from those patches. We aren’t ready to do that yet. We are still exploring it. We think our sweaters are different than that of other sports franchises. We also are looking for what we think would be a bigger impact.”

Adam is the Founder and CEO of Front Office Sports. A University of Miami Alum, Adam has worked for opendorse, the Fiesta Bowl, and the University of Miami Athletic Department. He can be reached at adam@frntofficesport.com.

Sponsorship

Teams and Leagues Cozy Up to CBD Brands

The sports world is beginning to bring CBD companies into the fold, marking a significant milestone for the CBD industry.

Front Office Sports

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Patrick Gorski-USA TODAY Sports

*This piece first appeared in the Front Office Sports Newsletter. Subscribe today and get the news before anyone else.

As teams and leagues look for emerging partner opportunities, CBD brands are showcasing that they aren’t afraid to spend when it comes to sports partnerships. 

While not really a thought in the minds of professionals more than a year ago, CBD presents both a revenue opportunity and an interesting challenge for teams and leagues.

How did this happen?

Before the enactment of the new nationwide 2018 Farm Bill. there wasn’t much mainstream conversation around CBD. Since then, the category has exploded across both retail and sports.

When the bill passed, it legalized industrial hemp by removing it from the controlled substances list and allowing tribes, states, and territories to establish regulatory structures within their boundaries that allow farmers and ranchers to produce a high-value cash crop while retaining federal farm program benefits that were previously not allowed.

Teams and leagues are starting to find interest…

Just this past week, the Portland Pickles became the first baseball team with a CBD partner.

Before that, the Big3 signed a deal with cbdMD that made the brand the official CBD partner of the upstart basketball league. 

And, ahead of this weekend’s Indianapolis 500, Arrow Schmidt Peterson Motorsports announced its partnership with DEFY – a CBD-based sports performance drink.

The only problem with this partnership is that the drivers of the car can’t drink the drink due to the fact that CBD is on IndyCar’s banned substance list

Who’s sponsoring what?

Below you will find a list of some of the CBD and cannabis-related partnerships that have been signed recently.

Las Vegas Lights / NuWu Cannabis Marketplace

Big3 / cbdMD

Portland Pickles / Lazarus Naturals

Arrow Schmidt Peterson Motorsports / DEFY

Jonathan Byrd’s Racing / Liquid Gold Processing

RC Enerson / Craft 1861

It’s not just teams and leagues…

While the bigger deals might get more attention, CBD companies have also struck deals with athletes. 

For example, Bubba Watson has a deal with cbdMD, the same brand that is sponsoring the Big3.

Before Watson, Scott McCarron signed an endorsement deal with Functional Remedies, a hemp manufacturing company.

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Sponsorship

Are NFL Jersey Ads Next?

Front Office Sports

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May 15, 2019; Berea, OH, USA; Cleveland Browns linebacker Sione Takitaki (44) runs a drill during organized team activities at the Cleveland Browns training facility. Mandatory Credit: Ken Blaze-USA TODAY Sports

*This piece first appeared in the Front Office Sports Newsletter. Subscribe today and get the news before anyone else.

Jersey ads aren’t an unfamiliar sight at NFL practices. Brands like Lecom and Hyundai are visible on the practice jerseys of the Browns and Cardinals respectively.

The one place jersey ads haven’t shown up is in regular season games. 

Could that be changing anytime soon?

Speaking with SI, an NFL spokesman said, “Never say never, but there are no current plans to pursue or explore.”

With what SI estimates to be $224 million in revenue being left on the table by not having patches on the jerseys, why would the league not consider it? 

According to those inside the industry, the NFL is concerned about conflicts of interest between teams who may have patches of competitors of current partners for opposing teams.   

The NBA has found success…

The NBA launched its jersey patch program in 2017 and as of March of 2019, every team in the league found themselves with a patch on their jersey. 

According to Terry Lefton and John Lombardo of SBJ, the patch program has generated more than $150 million for the league.

Another important stat is that of the 30 team patch sponsors, 20 are doing business with NBA teams for the first time.

At this point, not having ads is more unusual…

Even MLB, considered the most traditional of sports leagues in the U.S., has experimented with sponsor patches since 2000. Of the major sports leagues in the U.S., here’s a look at which ones have ads on their game jerseys and which ones don’t. 

NBA: Yes

WNBA: Yes

MLS: Yes

NHL: No 

NFL: No

MLB: Yes (for special occasion games only – Mexico Series etc)

Internationally, teams are cashing in…

While soccer is somewhat different in that the advertising is not just a patch, but the primary part of a team’s uniform, the revenue potential can’t be argued. Here’s a look at what just five brands are paying international clubs, according to The 18.

Emirates / Real Madrid: $80 million per year 

Chevy / Man U: $68 million per year

Rakuten / Barcelona: $60 million per year

Emirates / Arsenal: $56 million per year

Yokohama / Chelsea: $51 million per year

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Sponsorship

CohnReznick Sponsors a Dive Inside the Business of Baseball

Accounting firm CohnReznick shows the business of baseball in two video series with MLB, “Business of Baseball” and “Front Office Focus.”

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CohnReznick MLB Videos
Photo Credit: Peter G. Aiken/USA TODAY Sports

Accounting firm CohnReznick is taking an authentic approach to its MLB sponsorship. Through a video series called Business of Baseball and Front Office Focus, CohnReznick lends its name to an inside look at professional baseball. The series is produced by MLB Network, where it airs, along with, MLB.com and CohnReznick’s website.

MLB confirmed CohnReznick as a sponsor of the video series to FOS. The two parties collaborate on ideas, but MLB declined to speak on the sponsorship further.

“Our team really wanted something that was authentic, not just a way to slap our name onto something, but to own something,” says Frank Longobardi, CEO, CohnReznick. “We are able to align some of our core values with what’s being talked about in Business of Baseball and Front Office Focus. That makes us feel good, as we felt we could drive content and value with our strengths.”

READ MORE: MLB Flies Under the Radar With Sponsor Patches

While service-oriented companies have sponsored sports for decades, it’s becoming more common for non-consumer brands to find ways to cut through the clutter,” says Joe Favorito, a sports marketing and communications consultant.

“These companies are tying to something that resonates,” Favorito says. “Consumers have millions of choices. If it comes down to personal choice, they remember the company for who their spokesperson is or the story being told.”

The Business of Baseball series launched during December’s Baseball Winter Meetings, where CohnReznick was the presenting sponsor of the meetings for MLB Network. Over the course of the video sponsorship, there will be approximately six Business of Baseball videos and up to 35 Front Office Focus clips through the season.

“They’re topics, like hospitality and security, that are the same types of things we deal with our clients,” Longobardi says. “We wanted to show similarities of how Major League teams go through some of the same things our clients go through.”

Each of the videos feature commentators and baseball executives. Front Office Focus highlights discussions with executives from the league’s 30 teams about issues ranging from team strategies to club operations, while Business of Baseball looks into how franchises transform the game through analytics and management, but also how they redefine the fan experience.

A recent episode, “The Business of Food,” featured a look at how food experiences now play into a fan’s trip to a ballpark., like a sit-down interview with Shake Shack founder Danny Meyer by CohnReznick Managing Partner Cindy McLoughlin talking about how the game day experience has evolved to include a culinary aspect. The restaurant industry is evolving inside and outside the ballpark.

“When you look at stadiums and games, it’s not just about baseball anymore,” McLoughlin says. “Fans expect an overall experience. People get to stadiums to stand in line, they need to get their Shack Burger.

“That led us to Danny Meyer to really peel back why it’s a benefit to him and how those synergies line up.”

The video topics originated in a brainstorming session featuring CohnReznick’s team and  MLB. The topics center around issues with innovation and analytics to elevate customer experience and retain loyalty. From these conversations, MLB could consider matching a team with a relevant topic.

“It puts us front and center with a really good brand,” Longobardi says of the partnership. “In any business, you want to align yourself with good organizations, and this relationship does that well and connects the right type of people we’re trying to attract, the C-Suite individuals to middle market to small public companies.”

READ MORE: The MLBPA Has Embraced Athlete-Driven Marketing

The sponsorship has allowed CohnReznick to provide clients, potential clients and employees with strong relationship building opportunities at games and events.

“It really has allowed us to spend some time with key clients and be able to spend quality time with our employees and enjoy ourselves,” Longobardi says. “We can more closely align MLB brand with our clients and our staff, and that makes it a unique experience.”

By tying in with behind the scenes content, CohnReznick hopes to resonate with clients beyond just a name on the screen.

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